The idea that the average guy can become rich via hard work and rigorously virtuous thrift is one of the compelling myths of the American experience.

But for the most part, myth it is. Two recent events are both driving it forward and exposing its basic phoniness. The first is the death last week of Thomas J. Stanley, coauthor of the bestselling book "The Millionaire Next Door," in a car accident. The other is the death of one Ronald Read, a Vermont retiree who appeared to be one of Stanley's emblematic secret blue-collar millionaires -- after a lifetime of low-wage menial work and frugal living, he was discovered to have amassed a fortune worth about $8 million.

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"I see no special heroism in accumulating money," Taleb wrote, "particularly if, in addition, the person is foolish enough to not even try to derive any tangible benefit from the wealth.... I certainly do not see the point of becoming [a millionaire] if I were to adopt Spartan (even miserly) habits and live in my starter house."

Good point, but I think he's totally wrong about the randomness thing. There are still places in this country, Houston for example, where a young, smart hardworking person can make (and save) serious bank.

Some of it depends on factors out of your control. If you were born a crack baby the deck is stacked against you from the start.

The U.S. also has imbedded policy issues with economic mobility:

"While faith in the American Dream is deep, evidence suggests that the United States lacks policies to ensure the opportunities that the dream envisions. According to the data, there is considerably more mobility in most other developed economies."

__________________Even clouds seem bright and breezy, 'Cause the livin' is free and easy, See the rat race in a new way, Like you're wakin' up to a new day (Dr. Tarr and Professor Fether lyrics, Alan Parsons Project, based on an EA Poe story)

Well, there's no question that luck has something to do with, but it's not so much good luck as a lack of bad luck. If I had had a serious medical issue or been in a major accident I probably wouldn't be FIREd now. And yes, investing through the 90s helped. But as Louis Pasteur said, luck favors the prepared mind. We have no way of knowing what will happen in the future, but I can guarantee that not trying to achieve FIRE will result in not achieving FIRE. Sounds a lot like sour grapes from a 62 year old guy who can't retire yet and needs to write an article to make a paycheck.

__________________"Good judgment comes from experience. Experience comes from bad judgement." - Anonymous (not Will Rogers or Sam Clemens)DW and I - FIREd at 50 (7/06), living off assets

So what's the message of this article, it's hard AND I DON'T WANNA DO IT, WAHHH!, so don't even try? Saving only 1/2 million isn't worthwhile? Just spend spend spend because it's all hopeless?

There, I completely agree about this being the message of the article, and I added a little.

__________________5/17/2018: Retired a second time, this time from my volunteer Admin duties. After 10 years of being on the team, and 40,000+ posts, the time just seemed right. It has been such fun to work with all of our Mods and Admins and I plan to stick around as a regular member.

Among my takeaways from the book, 'anyone can become a millionaire' wasn't one of them at all.

It was that you can't always recognize a millionaire by their home, car, clothes, etc. And that more often than an outside observer might think, those who look like millionaires because of their homes, cars, clothes are a few paychecks from financial ruin - no closer to FI than many with incomes far less. 'You can't judge a book by it's cover...'

And that the many 'stealth' millionaires who you aren't outwardly recognizable, often get there thru LBYM, a well known phrase here. The lack of bad luck does play a role, but good luck certainly isn't required. Millionaires through luck alone are a decided minority, and usually the first to squander that luck.

For most with average luck , the road to FI comes from LBYM, whether your income is $40K, $400K or $4M/yr. It might be easier at the top, but the principles are exactly the same for anyone who wants to maintain their standard of living before and after retirement.

So what's the message of this article, it's hard, so don't even try? Saving only 1/2 million isn't worthwhile? Just spend spend spend because it's all hopeless?

Exactly. $1 million is not the same as it was 30 years ago, so why try? Even though even today only 7 or 8 million households are millionaires. Better to be in the top 10% than the bottom 90%.

Just for fun I looked back at my last 20 years, and I am probably a pretty typical educated upper middle class American like the book describes.

Major mistake 1, did not start investing until 1994/95 until age 31, so lost the first 10 years

Bought a timeshare (love to travel), taken nice vacations every year, and have had serious high dollar medical expenses for my wife the last 4 years

Have donated 11% of my income consistently

Have invested 10% - 20% of my income consistently, though now it is ~ 6% due to medical bills

Had 2 kids

Moved out of starter house into new old house (1969), no McMansion here

Average salary for last 20 years is ~ $105k in the Metro DC area

Have supposedly not received any stock market gains for the last 15 years

Have still managed to accumulate $600k in investments. One more double and I will be a millionaire

I expect over their working life, most people in my shoes could become a millionaire if they focused on it. I have had splurges, gadgets, etc. and never really lacked anything.

It would be much harder for lower income people, but avoiding the mistake of starting late would make a big difference. They will also not need a full $1M to maintain their lifestyle.

Megacorp does provide a nice lifestyle and a million over time if you are reasonably frugal and aware of investments. If you are not on that road then your own business is probably your best bet to get there.

__________________
David

I get up at 7 yeah, and I go to work at 9. Got no time for livin yes I'm workin all the time. Seems to me I could live my life a lot better than I think I am. I guess thats why they call me the Working Man.

"I see no special heroism in accumulating money," Taleb wrote, "particularly if, in addition, the person is foolish enough to not even try to derive any tangible benefit from the wealth.... I certainly do not see the point of becoming [a millionaire] if I were to adopt Spartan (even miserly) habits and live in my starter house."

Some confusion there by Taleb I think. For many it's not heroism but about freedom.

I personally don't see the point of spending life energy on a non-starter house and a non-spartan lifestyle if that means bowing to strange wishes of strange masters. Especially since neither house or lifestyle will affect my happiness much.

As the discussion frequently goes:The Monk and the Minister“If you could learn to live on rice and beans you wouldn’t have to cater to the king.”

Of course this forum is where this message finds natural agreement. But look around and how people tend to handle money. I walk down the street, and except for the poor, people are stylishly dressed, and restaurants bars and bistros are full of exuberant crowds eating expensive food and drinking expensive drinks. I see my local son and his wife maybe monthly, and I am not sure I have ever seen them when they are not wearing new stylish clothing. And it is not like they didn't have a lot of knowledge and experience of inexpensive living growing up.

Ha

__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams

Taleb equates spending more with greater happiness, which studies show is true up to a certain point. But beyond that certain point maybe the guy with the starter house sitting on the beach in a beach chair with a margarita and a mystery novel is happier than the guy with a one hour each way commute sitting 8 - 10 hours inside all day (a lethal activity!) in a cubicle working on TPS reports surrounded by Wally's and pointy haired bosses.

__________________Even clouds seem bright and breezy, 'Cause the livin' is free and easy, See the rat race in a new way, Like you're wakin' up to a new day (Dr. Tarr and Professor Fether lyrics, Alan Parsons Project, based on an EA Poe story)

I remember seeing a story on TV about a parking lot attendant who never made more than 8 bucks an hour who ended up quote wealthy. His clients were bankers and investors and early on the dude asked for stock tips. After a while he could have schooled them.
I took time out from doing some interior painting today ( why pay someone) to read this thread. I agree the writer is a baby. You do not need to live like a pauper but you can LBYM and end up with a tidy nest egg. But Hell, I am preaching to the choir here.

Yeah, a lot of people would rather whine about how hard it is to save money so they have an excuse for not even trying. And don't forget- "the market is rigged and only the big boys win". This is a frequent claim by people who sold everything at the bottom of the market.

I agree that lack of serious bad luck and having marketable skills are both important. It also helps to be selective about your splurges. DH and I put a high priority on travel (with judicious use of loyalty programs) and have seen most of the major capitals of Europe. I have a safe full of beautiful jewelry, acquired over decades. To see us on an average day, though, driving around in a boring sedan we bought used and wearing jeans and tops from outlet stores, you wouldn't think we were multimillionaires, but we are.

Like Choices, above, I also do interior painting rather than hire it out, I mow our lawn, and I and just finished scraping "popcorn" texture off the last 2 ceilings that had it, painting several rooms and tiling the floors of 2 bathrooms. (We're about to put the house on the market and the cosmetic fixes help.)

Of course, I then spent $750 on a pair of ostrich boots last weekend to wear with my outlet-store jeans. Oops.

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